CA Inter P4 · Chapter 9 · Question 8 of 11
Operation costing is best described as:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) A refinement of process costing in which the cost of each operation is ascertained separately
Explanation
Operation costing ascertains the cost of each operation within a process, which is useful where products pass through a series of distinct operations (for example in engineering or toy manufacture). It is a more detailed form of process costing.
More Process and Operation Costing MCQs
- Q10The cost of normal process loss is borne by:
- Q11Opening WIP of 1,000 units (100% material, 50% conversion) had costs of material ₹30,000 and conversion ₹15,000. During the month 9,000…
- Q1In Process I, 10,000 kg of material was introduced at ₹24 per kg and conversion costs were ₹1,32,000. Normal loss is 8% of input and has a…
- Q2A process was charged with 6,000 units at a total cost of ₹3,07,200. Normal loss is 10% of input, saleable as scrap at ₹8 per unit. Actual…
- Q3Continuing the same process (abnormal gain of 100 units valued at ₹56 per unit; scrap value of normal loss ₹8 per unit), the net amount…